Can you cash out using an SBA Loan?

Dominick Wallace of Wallace Capital Funding, LLC is a member of XPX Atlanta
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Loans from the U.S. Small Business Administration can help businesses “start, build, and grow” but can they also be used to cash out?

If you are a small business owner, chances are you have heard of SBA loans.

If you haven’t, SBA loans are a means of funding for small businesses through the U.S.’s Small Business Administration. These loans give small business owners the chance to get financing with the backing of the federal government.

The federal government guarantees the loan so if something happens, they will pay back the bank if the loan defaults.

Say you invested $500,000 in the constructing and building of your business and you wanted to cash out.

Could you actually cash out using an SBA loan?

One couple came to Wallace Capital Funding, LLC with the same question.

The couple had a long history of coaching local kids in basketball and wanted to have a basketball facility of their own as a way to give back to their community.

But not just any basketball facility, they wanted to have a world-class basketball gymnasium for kids to come and train. Without taking out any loans, the couple invested $3 million of their own money and brought this multi-million dollar facility to their community.

The facility turned out to be a large success and amassed millions of dollars in value.

The couple wanted to see if they could cash out their investment through an SBA loan.

The answer is it depends.

Currently, we are looking into the method of how they invested into their business. Under SBA guidelines, there are regulations on ways and how much you cash out?

Every transaction is different, and unique rules apply to your specific opportunity.

The benefit of working with Wallace Capital Funding, LLC instead of a bank is that we will work with you to ensure the structure of your loan application under SBA guidelines from a business owner point of view.

WCF consultants will use the Business Funding Analysis to help structure the deal properly so you can get the cash your business needs. You can also join WCF’s mailing list, which can be found on our website or give us a call at 1-800-809-5629 to learn more.

For all of your business financing needs, Wallace Capital Funding, LLC can help. Whether you need funding for new equipment, financing commercial real estate, or to cover staff expenses before your contract payment comes through, Wallace Capital Funding, LLC can create a custom funding solution that’s right for you.

Updated: April 3rd, 2022

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